Makhado budget holds moderate increases with focus on job creation

As usual the ratepayers in the Makhado Municipality will have to fork out some more money in the new year to subsidize increased municipal expenditure, but the tariff increases are fairly moderate. The focus in the new year also seems to be on stimulating the local economy to create more employment opportunities.

The mayor of the Makhado Municipality, Cllr Shonisani Sinyosi, presented the 2018/19 budget during a function at the Ha-Mutsha community hall last Friday (8^th). She said that Council expect a total income of almost R1 billion (R996 million) for the next year. Only R78 million of the revenue will come from own sources. The allocation from National Treasury’s Equitable Share is estimated at R316 million. She did not expand on the remainder of the sources of income, apart from the Integrated National Electrification Programme (INEP) grant. “We expect an estimated R16,9 million from INEP, which is a grant for electricity connections,” she said.

Electricity to go up by 6,84%

The rise in electricity tariffs is guided by the national electricity regulator, NERSA, and is set at 6,84%. The rates for refuse removal and sundry tariffs were adjusted in line with inflation and as guided by Municipal Funds Management Act circulars.

“The refuse removal tariffs will increase by 5,3%, while the sundry tariffs will also increase by 5,3%,” the mayor announced.

Council has not budgeted for any increases in property rates for the coming year. The new valuation roll, where property values had been adjusted, will come into effect from July 2018.

The mayor pointed out that the municipality had been able to fulfil its credit obligations with major creditors such as Eskom. This is in stark contrast with neighbouring municipalities where Eskom has threatened to cut the power supply at certain periods to force them to pay their debt. “Our target for revenue collection during the next financial year is 90%,” she said.

Towards a clean audit

Mayor Sinyosi again stressed the importance of accountable local government. The Makhado Municipality received an adverse audit opinion from the Auditor-General in the previous financial year. “I am not happy with the audit outcome, because it signals a decline from the previous years’ qualified audit results,” she said.

The mayor said that an action plan was in place to address issues raised by the Auditor-General. “We have also committed ourselves to fiscal prudence that reduces unauthorised, irregular, fruitless and wasteful expenditure,” she said.

The mayor did not mention the VBS Mutual Bank scandal by name, but did refer to it when she said that Council had adopted an investment policy “to ensure that all investments are taken in line with applicable legislation and treasury regulations.” Makhado Municipality invested more than R62 million with VBS Mutual before the bank was placed under curatorship earlier this year. It is doubtful whether the municipality will be able to get all the funds back.

Stimulating the local economy

One of the central themes of the budget is job creation. Mayor Sinyosi referred to South Africa’s unemployment rate of 36,7%. “…and youth unemployment stands at 49,6%,” she said. The local municipality has supported several projects whereby people are employed on a temporary or permanent basis. “Over the past three years, a total of 2 552 work opportunities were created through our internal capital-intensive projects and the Expanded Public Works Programme,” she said.

The target for the new year is to create 1 446 work opportunities. “It means our capital and infrastructure projects must be labour-intensive to ensure that we reach the EPWP targets,” Sinyosi said. She mentioned that, by December 2017, the Makhado Municipality managed to spend more than 50% of its Municipal Infrastructure Grant (MIG). “National Treasury has since then given us an additional R15 million for infrastructure development,” she said.

Business development

Special mention was made of the extension of the Makhado Crossing Mall to become a regional mall. This development is being done by the Masingita Group of Companies and is expected to provide 550 to 600 jobs during the construction phase. “More than 700 direct and permanent jobs will be created post construction of the mall,” Sinyosi said.

Other developments referred to by the mayor include 20 sites in Waterval for businesses and the selling of land next to the N1 in Eltivillas to accommodate restaurants. The new Builder’s Warehouse will also open in the next few months.

“We must attract more people to stay in town, so that we create a more vibrant and sustainable buying power for businesses in town. We shall sell vacant stands in the town and also dispose (of) more land for residential and industrial development,” she said.

Mayor Sinyosi again referred to the piece of land that Council donated last year to the University of Venda for the building of a satellite campus. “We shall fast-track the process of setting up a team to ensure that this opportunity is seized,” she said. She said similar discussions were underway with UNISA and Vhembe TVET to have fully fledged campuses in town.

The quest for land

The budget tries to address the urgent need for land for development and residential sites. The mayor made it clear that this needs to be addressed in a structured way. “We do not encourage our residents to occupy land illegally, as it undermines the constitutional framework and the commitment of government to ensure proper and coordinated development of land to the landless,” she said.

Mayor Sinyosi expanded on a previous announcement that more residential sites will be developed in places such as Tshikota. She referred to Council’s mandate to address past injustices where “land-use laws and practices … were based on racial inequality, segregation and unsustainable settlement patterns”. A total of R3,5 million has been budgeted to assist traditional leaders in establishing formal human settlements by demarcating residential sites.

As far as the indigent and the elderly are concerned, Council and the relevant government department intend building 118 Community Residential Units (CRUs) in Ward 7 of Tshikota township in the next year. The mayor also made mention of the establishment of a multi-stakeholder housing committee that was formed in Tshikota. Among others, this committee will conduct an ownership audit of RDP houses in Tshikota and to oversee the allocation of new RDP houses to deserving members of the community.

“During the next financial year, the Department of Planning and Development will receive an estimated R11 million for various projects and programmes,” the mayor said. She stressed that Council is committed to tending to land rezoning, sub-division and other land-development applications. “A delay in approving land-development applications is a delay in attracting economic investment within the municipality,” she said.

Date:19 June 2018

By: Anton van Zyl

Anton van Zyl has been with the Zoutpansberger and Limpopo Mirror since 1990. He graduated from the Rand Afrikaans University (now University of Johannesburg) and obtained a BA Communications degree. He is a founder member of the Association of Independent Publishers.

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